ChartSmarter Tuesday Game Plan 3/13/18

Markets were slightly bifurcated to begin the week Monday as the Nasdaq pressed on with its now 7 day winning streak adding .4%. The Russell 2000 inched higher by .2% and is now closing in on a 1615 cup base trigger that began on 1/24 and would negate a bearish engulfing candle from that session. The Dow, a price weighted index, was held down by its most expensive component BA which lost 10 handles today. It is a small start but when looking at the VIX the bull shad to be inspired as it reversed at its 50 day SMA today. It did end a 6 session losing streak with a bullish inverted hammer candle, but lets see how this week plays out. It is still holding the 15 cup base breakout trigger so one has to be mixed with the action here. The auto group was a great actor Monday led by TSLA. Of course it is a cult stock but it is carving out a nice cup base that found support at the very round 300 number last July, from last November-December and this February.

Looking at individual groups that led Monday it was technology and the cyclicals with both the XLK and XLI higher by more than .3%. The utilities rounded out the top 3 and this sector has seen a real struggle between bulls and bears as it is either near the top of the leaderboard or the bottom. The bears still have the long term control of the ETF on a leash, but the short term is making a noteworthy battle. Lagging in a significant way were the industrials as the XLI surrendered 1.2% as its largest component BA, more than 8%, fell nearly 3% today. In fact 9 of the top ten stocks in the ETF fell Monday, with the lone exception being GE, which has been a dismal performer down more than 50%, without a 2:1 split (apologies for any long shareholders at my attempt of humor). Energy is attempting to make some positive strides as individual names in the space are trying to make a name for themselves. The XLE had the look of a bear flag, but the pattern is becoming a little long in the tooth. Avoid playing the ETF, rather search for names outperforming the overall arena.

Healthcare is a group that has not been getting a ton of attention with tech and financials deservedly capturing most of the chatter. That gives those who are focusing on the sector some advantage. Sure the IBB is on a 7 session winning streak, albeit with a doji candle Monday, but looking after more undiscovered gems is very worthwhile. Below is the chart of JNCE and how it appeared in our Friday 3/2 Game Plan. It found great support at the very round 20 number on 3/1-2 and has since sprouted well more than 30% this month and as most leading stocks do, they give you an opportunity to add to, or for those who missed the initial move a chance to start a position. To be completely frank I was not expecting this name to approach its add on cup with handle trigger of 26.65 in such a rapid fashion but give the name the respect it has earned. There is yet another entry point and that would be through a cup base trigger of 29.39 which would record an all time high.